You race home with a new flat-screen TV, or you excitedly drive off the dealer’s lot with a pricey new car. You think it’ll bring you joy, but it doesn’t; you get home and buyer’s remorse sets in.
We’re all familiar with that sinking feeling that comes when we spend money on something we probably shouldn’t have. But what if there was a way to spin buyer’s remorse into a learning opportunity? What if that feeling could actually inspire you to develop better financial habits?
The good news is it can.
Why you get buyer’s remorse
Before you learn how to harness buyer’s remorse for good, it’s important to realize why you get it in the first place.
The most obvious answer, of course, is that you get this feeling because you’ve spent money on an item that doesn’t give you the happiness you expected it to provide. The amount of money doesn’t always matter. You can experience buyer’s remorse from a huge purchase, such as a home, or from something as small as a latte on the way to work. (See also: Why Do We Feel Buyer’s Remorse, Anyway?)
Using that sinking feeling for good
If you’ve made a purchase you now regret, don’t fall into too deep of a funk. Instead, use that feeling of buyer’s remorse to change your spending habits for the better.
Before heading out to any store, make a list of what you want to buy and only buy the items on that list. As you stare at the magazines, candies, and individual-sized bottles of soda near the cash register, keep looking at the list. Did you buy everything on it? Yes? Then you’re done shopping.
If you’re ready to make a big purchase, such as a house or car, doing the proper research beforehand can help you avoid buyer’s remorse. Reading online reviews, talking with friends, and comparison shopping can all help. And if you think this is simply too much work, take a look at the most recent item you purchased that gave you buyer’s remorse. Does that item give you any pleasure today? If not, remember that lousy feeling. A little research is a lot less painful than a bout of buyer’s remorse.
You can also use the feeling of buyer’s remorse for a bit of self-examination. Sometimes we get buyer’s remorse not because we bought the wrong item, but because we overspend as a way to make ourselves feel better. Problem is, this rarely works and often leaves us in debt.
Look at the things that give you pleasure that don’t involve buying anything. Maybe you feel good when you take your kids to the park. Maybe a daily bike ride boosts your spirits. You might feel joy from playing cards with friends or sitting on the front porch and chatting with your neighbors. Spend more time doing these activities — ones that don’t cost you any money — instead of relying on making new purchases. You’ll experience a lot less buyer’s remorse. (See also: 6 Ways to Avoid Buyer’s Remorse)
Confirmation bias and the decoy effect
Finally, use your buyer’s remorse to recognize two key retail strategies that often lead consumers to overspend in the first place: confirmation bias and the decoy effect.
Confirmation bias is a condition in which you are apt to believe information that conforms to your prior beliefs. You ignore everything else. Marketers know about this bias, and aren’t afraid to take advantage of it. Maybe you rent an apartment. That apartment might fit nicely in your budget, but deep down you want to own your own home.
You are then more likely to believe the ads from local real estate agents telling you that owning a home is part of the American dream and a good way to build wealth over time. At the same time, you might ignore any marketing promoting the benefits of renting, because you would rather believe the information you’re seeing about homeownership.
You’re more likely to experience buyer’s remorse if you immediately buy an item — even something as big as a new home — based on this advertising. Resist the urge to purchase something just because the company behind it, or the person selling it, tells you it’s the best choice. Instead, try to look objectively at your choices and your finances, and keep an open mind to find the best option for you.
The decoy effect is a bit simpler, but still effective. This is when retailers place a lower-priced item next to one that is higher-priced. You see this and you automatically assume that the lower-priced item is a good deal. Unfortunately, this isn’t always true. That lower-priced item might still be priced too high, and it might not provide you with any pleasure when you get it home.
Do your research before entering a store, or stick to your list of items to buy, and you’ll lessen your odds of falling victim to the decoy effect. Even better, your risk of buyer’s remorse will also drop. (See also: 5 Mental Biases That Are Keeping You Poor)